In today’s rapidly evolving crypto landscape, compliance is no longer about ticking boxes—it’s about proactively staying ahead of emerging threats with real-time Anti-Money Laundering (AML) measures. Even with three or more Know Your Transaction (KYT) vendors in place, the question remains: are you truly secure if you’re operating without actionable threat intelligence?
At NOMINIS.io our platform is designed to detect and mitigate risks in real-time. For instance, during an automated check, our system flagged a potential illicit actor engaging in repeated abuse of one of the largest cryptocurrency exchanges globally, utilizing it as part of their Laundering-as-a-Service (LaaS) operation.
How Laundering as a Service (LaaS) Works:
Advertising the Service: The illicit actor, functioning as a LaaS Provider, promotes their illegal laundering services across various platforms. This includes both traditional social media channels and darker corners of the internet like the dark web.
Receiving Dirty Funds: Other illicit actors, referred to as LaaS Clients, transfer dirty funds to the LaaS Provider’s private crypto wallet. These funds often originate from illegal activities such as fraud, hacking, or other criminal ventures.
Laundering the Funds: The LaaS Provider employs various techniques to clean the funds. These may include:
Utilizing exchanges that do not enforce Know Your Customer (KYC) protocols, allowing seamless crypto-to-fiat conversions.
Exchanging funds with other LaaS Providers to obscure the origin of the transactions.
Transferring Cleaned Funds: Once the funds are “cleaned’, the LaaS Provider uses accounts on mainstream exchanges to send separate funds to new crypto wallets via a different process. These transactions appear legitimate, leaving the exchange unaware of the illicit funds the LaaS was once involved with.
Looking to the future:
The attached diagram illustrates the flow of transactions between a LaaS Provider and their client, informed by intercepted communications from the LaaS Provider. This intelligence underscores the sophistication and reach of such operations.
However, it’s crucial to highlight that many illicit actors in the LaaS ecosystem engage in deceptive practices. Some provide falsified evidence of their laundering capabilities, leading to scams that exploit other criminals. Investigating and verifying such claims requires meticulous analysis by Virtual Asset Service Providers (VASPs) and law enforcement agencies.
